Performance Management & Strategy Execution Blog: The Glue

Why is Executing Strategy So Hard?

Please note: this is a special guest post by Brian Lassiter, President of the Minnesota Council for Quality, a state-level Baldrige program.

Given today’s economic challenges, strategy is critical.  But in various surveys by various experts, it is claimed that as many as 70-90% of business strategies fail.  According to a recent study, we may now know why…

I’ll define “strategy” as simply an organization’s approach (formal and informal) to preparing for the future.  Creating strategy is relatively easy: you gather some information, you conduct some sort of leadership retreat to sort through things, and then you set goals and maybe even create some action plans. But then you go back to the office (the plant, the shop, the bank, the school, the hospital, the whatever) and you work on more urgent things (notice I didn’t say more “important” things?). Why? Because executing strategy is hard, and there is always something more urgent that comes up in daily operations.

“Companies often manage strategy in fits and starts,” says Robert Kaplan, Harvard professor and co-author of several books on the Balanced Scorecard and strategy execution. “Though executives may formulate an excellent strategy, it easily fades from memory as the organization tackles day-to-day operations issues” – doing what Kaplan calls “fighting fires.”  I think we can relate: sometimes we all must react to issues within the business rather than managing the business itself.

Maybe it’s just how we’re wired as humans. Think about it: we set New Year’s resolutions, only to have 60% of them fail by late January (the average date of failure, interestingly enough is January 22 – tomorrow).  Or we get our annual physical and find that we need to exercise more, cut down on unhealthy foods, and quit smoking.  So we try for a few weeks (or months), but then eventually those entrenched habits start to creep back into our daily routes (the fast food, the shorter or skipped workouts, etc.).  So, in our Darwinian nature, maybe humans are just wired to react to problems rather than proactively set – and take – new direction. After all, we’re creatures of habit that settle into natural patterns, rather than true change agents that set, implement, and sustain new courses of action that may, in fact, be healthier, more productive, and just better for our overall outlooks.

So why should organizations (made up of humans) be any different?

A recent study by Minnesota-based Digineer (conducted by Pat Salaski, a management consultant and a 2009 Minnesota Quality Award Evaluator), set out to answer the fundamental question: Why is executing strategy so difficult – especially during today’s tough economic conditions, when strategy is really so paramount to long-term success?

They surveyed 65 leaders from various industries in the Twin Cities, representing a mix of industries and diversity of organizational levels (34% senior executives and other high level leaders, 30% middle level leaders, and 36% lower level managers). The findings were actually quite interesting (for a report on the findings, visit http://www.councilforquality.org/improve_documents.cfm and enter the word strategy in the search box).

Take, for example, the fundamental notion that 69% of these leaders are NOT confident in their organization’s ability to execute strategy. Wow – that is as disturbing as it probably is accurate: leaders at various levels in the organization fully recognize and are realistic about the challenges in implementing strategic actions within their organizations. The more interesting question, however, had to do with why…

When responding to the question of what was the number one barrier to effectively executing their strategy, what would you predict? The economy and constrained financial resources perhaps?  Increasing competition, which causes priorities to shift? Maybe rapidly changing market dynamics and customer needs? Game-changing regulations? No, no, no, and no.  In fact, most of the barriers reported by these leaders were INTERNAL issues, not external factors. In ascending order, they were:

•     Company reputation, mentioned by 4% of respondents
•     Customers, 10% (those darn customers)
•     Lack of confidence, 16%
•     Technology, 18%
•     Competitive Environment, 24%
•     Government Regulations, 26%
•     Employees, 30%
•     Way We Work Together, 34%
•     Budget, 40%
•     Economic Conditions, 44%
•     Middle Management, 46%
•     CEO/President, 50%
•     Senior Management, 52%
•     Company Culture, 64% -- and the number one reason strategies fail to be fully executed:
•     Past Habits, 66%

Wow – I never saw that coming. In fact, look at the top two vote-getters: company culture and past habits. There are those habits again – organizational inertia, inability to take action on new initiatives, slow or indecisive decision making, lack of accountability, short-term focus (“chasing rabbits” or finding the next big fad) – who knows the real reason(s), but interestingly enough: these leaders believe their strategies are not executed because of the organization’s tendencies itself. (Economic conditions, despite the depth and length of this recession, came in sixth. And, along with Government Regulations, were the ONLY TWO external factors listed in the top 10!)

I find it also fairly interesting that these conclusions were very similar to a University of Michigan study in 2005, which also found that internal barriers were more constraining in general than external (“Leaders Talk About Executing Strategy,” Michigan Ross School of Business, Theresa Welbourne, March 2005). So these tendencies seem to exist in good times and in bad (and maybe they have for decades or generations, which might explain why 70-90% of strategies are said to fail).

But why? The Digineer study found several possible contributing reasons as to why internal dynamics and past habits get in the way of strategy implementation. Of those nearly 70% who were not confident in their organization’s ability to execute strategy, here were the top reasons for that lack of confidence:

•     Unclear accountability for execution, 52%
•     Internal resistance to change, 48% (“we’ve always done it that way”)
•     Buy-in or agreement on critical execution steps or actions, 40% (perhaps because the right people were not involved in setting direction or action plans)
•     Employees’ lack of ownership, 38% (involvement, again)
•     Lack of a model to guide strategy execution, 27%
•     Organizational structure, 23%
•     Inappropriate incentives to support execution objectives, 21%
•     Poor or inadequate information sharing, 19% (which surprised me that it was this low, as poor communication, including action plan and results tracking, to me at least usually contributes to execution challenges).

This is quite similar to a list presented in an issue of Quality Digest last summer (“Enterprise Performance: The New Quality Goal,” David Boghossian, August 2009 – find it at http://www.councilforquality.org/improve_documents.cfm).  Boghossian recognizes the age-old challenge of implementing strategy: “Strategy into action.  It remains at the leading edge of management science.  Very few organizations do it well, and even those that do often get there more through art than through science.  Extremely rare are organizations that have a well defined, documented, trainable, continuously improvable process for executing strategy.”

He goes on to state that all contemporary methodologies for implementing strategy – Balanced Scorecard, Hoshin Planning, and others – really have five common elements, that wrap nicely into a process sequence (with my commentary in parenthesis):

1. Focus on a few critical strategic goals.  (My sense is you identify these critical goals through traditional environmental scans, SWOT analysis, and other data sources.)
2. Identify key prformance indicators that measure progress toward those goals.  (One of the themes that emanates from the Digineer study is the lack of data in strategy execution – measures to help leaders monitor progress of plans, communicate plans, reinforce accountability, serve as a basis for reward, and so forth.  Without measures, you simply cannot expect action to take place…or take hold.  And you certainly won’t know if you ever “got there.”)
3. Assess initiatives against a screen of strategic effect and cost benefit.  (This speaks to prioritization – of selecting the RIGHT strategic initiatives, given your desired direction and the expected return on investment of your actions.)
4. Execute programs that deliver the benefits.  (Simply put: do something.  Take action.  Eliminate other work if you need to create capacity, but organizations have to allow – and require – actions by various contributors in the organization – to move the enterprise closer to its desired destination.)
5. Review progress against Key Performance Indicator targets in real time and adjust course quickly when necessary.  (This part is hard, but critical. Use the data and measures you’ve selected to monitor progress and make mid-course corrections. If the actions are not moving the organization closer to the desire end-state, then either the measures and hypotheses were wrong, or the actions were wrong. Either way, make adjustments and measure the effectiveness in your new set of actions.  This is the classic closed-loop process of strategy – design, test, do, measure, adjust.  Sound familiar? It should: it’s the basis of PDSA (Plan-Do-Study-Act) and Six Sigma’s DMAIC (Design-Measure-Analyze-Implement-Control)).

In challenging times (and really in ALL times) a key role for leaders is to set and execute strategy – to set a vision for the future and align organizational resources to move (and adjust) toward that vision.  Strategy is critical to helping organizations address their environmental challenges; leverage their core competencies and strategic advantages; address their marketplace and stakeholder needs; recognize and respond to risks, competitive pressures, internal weaknesses, shifts in technology or regulations; and – in essence – prepare for the future and sustain the enterprise.

The Digneer study asked leaders their opinion on the consequences of poor strategy execution. The top responses included:

•    Decreased employee commitment, 67% (more on that in next month’s newsletter)
•    Lost Market Opportunities, 53%
•    Decreased Revenue, 53%
•    Increased Costs, 39%
•    Increased Cycle Times, 28%
•    Decreased Customer Loyalty, 28%
•    Lost Market Share, 28%.

Sounds like a case for action to me.

“These findings represent both good news and bad news,” says Pat Salaksi of Digneer and author of the study.  “The good news is that these internal factors should be able to be addressed by senior leaders. The bad news is that they are the same internal factors that have been identified in multiple other studies on this topic for years.”

In other words: we haven’t learned how to break through the strategy execution barrier, in good times or in bad. But maybe we’ll have better results this time, as companies get serious in taking action to emerge from this economic downtown. We can only hope.

Yours in Improvement,

Brian S. Lassiter

President, Minnesota Council for Quality
www.councilforquality.org

Should Scorecards be Strategic or Tactical?

In one word, “yes.” Balanced Scorecards are both strategic and tactical, depending upon where they exist in an organization.

Before I explain, let's take a step back and define terms. What do we consider to be strategic? The practical definition is that it is what emanates from a strategic planning process, usually in the form of multi-year strategic improvement goals or objectives (such as "Grow Global Revenues") or as strategic imperatives or initiatives that support these goals and are time-bound by design (e.g., "Develop two new products to fuel global revenue growth"). Tactical can be defined as those activities that are designed or carried out with only a short-term end in mind.

So strategic issues are longer term and improvement-focused and therefore appeal to -- and must be managed primarily by -- the senior leaders of an organization. So since they own these issues, senior-level scorecards should clearly be dominated by strategic -- not tactical -- goals and issues. And to be really forward-looking and strategic, senior management-level scorecards should have multi-year targets for goal measures and multi-year improvement initiatives, as well. Some of these initiatives might have milestones that start later in the current fiscal year or even in future years.

The Dark Side of Metrics?

There was an interesting article in the New York Times a few weeks ago called "Are Metrics Blinding Our Perceptions?" In it, author Anand Giridharadas questions whether the prevalence of computers and dashboards have resulted in too many metrics. He wonders if ours is simply a world with too much data -- where metrics are distorting policy, altering the flow of charitable donations, and even driving how parents take care of babies.

It’s a good read, and raises some interesting questions. I think the issue boils down to this: yes, computers and the internet have made it easy for anyone to create dashboards and share metrics, which is why it's more critical than ever that metrics are presented with their correct context and that they are thoughtfully reviewed before using them to make decisions.

In years past, a business dashboard could have taken many "man-months" to create. It would have involved coming up with a well-thought out strategy with strategic metrics (be it for a government, company, or whatever), developing attractive reports with help from graphic designers, professionally printing and hand assembling the reports at great cost on a monthly or quarterly basis.

Today, you can take any old collection of metrics and make them look pretty good with a fraction of the effort. In short: any idiot can create a decent-looking dashboard these days.

But of course more measures, more dashboards, and more reports aren’t going to make the world any better on their own. Garbage in, garbage out holds true for metrics, dashboards, and any process in the world. There are lots of software tools that make it easier to make the garbage coming out look nicer, but from a business perspective, it remains essential to ensure that the strategy, objectives, measures, and initiatives that end up on a scorecard or dashboard are the right ones. And that there aren’t too many. And that they have owners responsible for their performance. And that appropriate goals have been set. All of the things that this blog is about.

So, yes, it's true that metrics can be taken out of context or relied upon too heavily without applying common sense. But what's also true is that when the right metrics are on a functional -- and, yes, ideally attractive -- dashboard, they can mean the difference between excellence and failure.

Just take a look at Datron World Communications. This fast growing, high performing organization has focused on reviewing and managing the right measures systematically on dashboards. Using this approach, they were able to drive incredible tangible business results. In fact, they just won the Overall Business Performance Leadership Award from Ventana Research.

Art Barter, Datron's CEO, confirms that this focus on a dashboard with the right metrics works: "Let’s be good at these three or four things. Let’s understand what impacts results in measurable ways, and let’s stay focused on those things, instead of trying to do 10, 15, or 20 things that we think might impact the results." He credits this approach with $40 million of new business, as well as higher levels of trust in the organization, and improved customer satisfaction levels. You can read the full story in an interview that BPM Magazine conducted with Mr. Barter.

What do you think about the pervasiveness of measurement in your organization? Has it gone too far? Or gone off-track?

ActiveStrategy Enterprise -- an Aspirin for Organizational Performance?

Some things are good for you in so many ways, you feel like a fool if you don’t use them. Aspirin, for instance, is good for your headache, can save you during a heart attack, may reduce the risk of certain cancers, and may even help prevent cataracts. Exercise is another great example. It helps your health, your looks, your disposition, and gives you a hobby. Now here's one you probably didn't know about: ActiveStrategy Enterprise (ASE) performance management software. Really!!

O.K., I know. It sounds like a stretch, but bear with me while I explain.

I recently assisted an organization with their application for a state-level Baldrige-based award. The organization has well deployed scorecards in ASE and they conduct regular Business Reviews within the software, drilling into the scorecards to discuss performance and root causes of problems. They will get Baldrige points in the “Leadership” category for establishing and maintaining a systematic approach to moving the organization toward their vision (see illustration depicting Baldrige categories below) . And they'll get big points in “Strategic Planning” for having a well defined approach to planning and plan deployment.

They use customer input to refine their metrics, and so will “score” in the “Customer Focus” category.  Don’t get me started on “Measurement and Knowledge Management.” ASE provides accessible data on everything that is critical to performance and is a one-stop-shop for finding and sharing success stories and methodologies that "all hands" should be aware of. 

As for the required use of comparison data and benchmarks, ASE keeps it in view and part of on-going analysis of operations. Even if you don’t use the “Personal Goals Management” feature of ASE (which enables employee-level scorecards), you still get a lot of the "Workforce Focus" that Baldrige requires by making it easy for everyone to see how projects affect the big picture.

What Football Can Teach You About Performance Metrics

I have often made the point that if you want to understand how to use performance metrics to drive results in business, take a look at professional sports. I make this observation without an impressive understanding of any pro game, but simply by listening to the nature of the commentary, particularly during football games.The statistics just keep on coming.

This year I am hearing more about “red zone efficiency.” As I heard in Sunday’s game, in which my beloved Dolphins fell to New Orleans’ Saints (on All Saints Day, might I add), "the Saints scored in four out of their five trips to the red zone, while the Dolphins converted on only three of six.” I bet the Dolphins are running a lot of red zone plays in practice this week. Here at ActiveStrategy, we would call that implementing an action plan to close a performance gap.

The next set of statistics I have in the article in front of me could be loaded in the PGM or “Personal Goal Management” scorecards in ActiveStrategy Enterprise software.  Apparently, our infamous Ricky Williams tied his career high with three touchdowns and the dancing Jason Williams had two sacks and two forced fumbles. If that’s all you knew, you would have thought they won.

Let’s venture into the “leading” measures (the numbers that tell the story for the different units) to see if they give us any insight into the ultimate lagging measure -- the final score. Remember, I could use the help of a fantasy footballer, but by my analysis, only two numbers pop when you compare the statistics of the two teams (besides “red zone efficiency”). Those two are passing, where the Saints tallied 276 yards vs. the Dolphins' 197 yards; and penalties, where the Saints gave up only 25 yards vs. 55 yards lost for the Dolphins.

When you read the expert commentary, in fact, these numbers do tell a critical part of the story. In spite of first half interceptions, the Saints' QB was a second half wonder and the Dolphin penalties came at critical points in the second half. Bottom line, all the fantasy football addicts in your organization should be able to lead the discussion on the relationship between process measures and outcome measures. Are the number of penalties a measure of errors or rework or both?

Either way, leading measures are more important in business than in sports, because in sports your “line of sight” between the lagging measure (the score) and the leading metrics is literally and figuratively far better. Even without the commentators spewing out statistics, the most casual observer can tell if turnovers are killing a team or if the QB is getting less protection than the Prime Minister of Sweden. Just watch the game. 

In business you need to make more of an effort to define and manage that "line of sight" between the lagging measures that are essential to survival (total sales, customer satisfaction, profitability) and the leading measures that impact those lagging measures.

For example, if cycle time suddenly spikes in your organization (because you're having to do rework in one part of a process, perhaps) and you don't have good visibility into your leading performance measures, business leaders might not see the problem until it's far too late. You could be bankrupt before you know what hits you. The bottom line is that if you don't have good visibility into the leading measures in your business (and their relationship to your critical lagging measures), it's like trying to coach a team on the field without knowing anything but the score.

On very rare occasions in business, you can see that the ball is being fumbled and the solution is obvious (like Starbucks offering a cheaper latte). But most of the time to get back on track you need good data on how you're doing in the red zone plus a good team executing a solid game plan, all of which can be enabled with software. If you're curious about that, I invite you to read more about ActiveStrategy Enterprise software.

Accelerating Your Baldrige Journey - Free Webinar

Is your organization pursuing – or thinking about pursuing – the Baldrige Quality program or similar performance excellence criteria? If so, ActiveStrategy can help you achieve better results, and do so more quickly. Attend a free, informational webinar this Wednesday to learn how.

In the webinar we'll cover:

• How we help organizations take next steps on their Baldrige journeys by identifying, tracking, and managing to improve specific OFIs (Opportunities for Improvement).
• How our software, ActiveStrategy Enterprise, supports what organizations must do to score well in all seven Baldrige categories.
• How our software and services have benefited award-winning organizations in their own journeys.
• We'll also have the CEO of Feather River Hospital (a 3-time California CAPE Winner) as a special guest, discussing why they recently selected ActiveStrategy Enterprise software as a tool to help them achieve even more on their already impressive journey.

Webinar Details

Title:   How ActiveStrategy Accelerates Your Baldrige Journey

Date:   Wednesday, October 28th

Time:   2:00 - 3:00 pm Eastern (11 am - 12:00 pm Pacific)

To register: https://www1.gotomeeting.com/register/519090752

If you can't make it, but are interested in the topic, register anyway. We'll send you a recording link after the live webinar. Also, check out our webinar archive for more topics that may be of interest.

Hope to see you there!

Healthcare: Quality Improvement for the Long Haul

In a recent write up from HealthLeaders Media, Elyas Bakhtiari provided a great summary from a recent panel discussion in Chicago, The Hospital of the Future Now. The leaders on the panel suggested five strategies for improving healthcare outcomes, all of which stress performance management principles as ways to drive results in hospitals. The strategies included:

1. Make quality permanent. The panelists made the point that we need to create a culture around quality, even setting quality as the foundation. I'd ask you to think about what you do to help make quality a key theme within your organization? What tools do you use to help keep your quality meetings timely and focused? Establishing a “rhythm” and an expected, repeatable approach to reviewing measures and the status of initiatives helps keep the quality message at the forefront.
2. Seek the right outcomes. The panelists talked about getting to the core of the measures that make a difference. At ActiveStrategy, we often describe this as identifying the “lagging vs. leading” measures. Does your organization report on “everything” – only to find that little to no gains are made over time? Focusing on the right set of metrics is a big key; it takes some work and targeted facilitation, but the impact is well worth the effort.
3. Include a broad community. Here the panel was stressing the point of focusing not only on the outcomes of procedures, but also on the outcomes of the communities being served. Again, I think the question from a performance management standpoint is: do you have the right metrics? Do your measures capture the impact you have (or wish to make) on both short term and long term outcomes? Collaborative measures may also be appropriate for joint efforts in areas like childhood obesity prevention or rural health programming.
4. Use technology to support, not drive, improvement. The panelists urged the attendees to beware of making technology a solution in itself. As you well know, with any implementation of technology, it’s the “meaningful use” of that tool or system that will help drive and sustain change.
5. Get ready for integration. The panel suggested that while new models like medical homes and accountable care organizations show promise, healthcare leaders need to continue pursuing innovation and new solutions.

When a Balanced Scorecard performance management framework is cascaded and deployed, it supports these approaches perfectly. It helps an organization focus on quality in a broad, outcome-based, collaborative, and integrated way -- making the quality message and the quality culture “stick.”

Have you come up with strategies to make quality a key, enduring theme? Let me know in the comments!

Using Spreadsheets for Performance Management: Why They Work and Why They Don’t - Part 4

If you’ve been following my previous posts in this series…and also know me and/or ActiveStrategy, you may have been wondering: Why is he praising Excel? Wasn’t ActiveStrategy created to replace Excel and other manual tools for performance management?

Yes, that’s true. And it’s also true that Excel is a great tool for the specific reasons and applications I blogged about.

But if you’re really trying to drive results at an enterprise level – trying to achieve the strategic outcomes your organization needs (and who isn’t?) – Excel is simply the wrong tool for that job. When it comes to performance management, Excel has a tendency to lead you down a swirling rat hole of bad data and missed opportunities, or help you build a performance management framework that will collapse under its own weight. I know. I’ve been there.

Why do I say this? Because although Excel is good with data, it is terrible for tracking action, ensuring accountability, and supporting a community of users that are trying to march together toward better performance and results.

Let’s first look at how Excel falls down when it comes to driving action.

As I’ve discussed before, data is only one ingredient for successful performance management. Another critical ingredient is action. The actions people take to learn why performance isn’t hitting targets. The actions people need to take to get performance back on track. Even the mundane actions people take to collect and report data and explain performance in one place. All of these actions are critical to improving rather than reporting results. And it is here that Excel begins to fall down.

Excel is, by its nature, a single file of data. You can open it and run some macros that do things, but in general it isn’t going to actively move people along to complete actions. For example:

• Excel won’t email a person and/or the boss when he/she needs to explain why a measure didn’t hit its target.
• Excel won’t capture the complete history of a portfolio of initiatives/strategic projects as they relate to the performance of a measure.
• Excel doesn't make it easy to capture action items during performance reviews or offer reminders and easy ways to follow up to make sure those action items get done.
• Excel doesn’t understand the organization’s reporting hierarchy, so it won’t provide managers with a simple view of what their teams are working on.

These are just a few examples -- some of which might be beyond what you're currently thinking about doing in a spreadsheet-based Scorecard or performance management framework. But support for these and other actions is critical if you really want to drive results. So here are some early warning signs that your performance management framework is starting to outgrow Excel:

• If you’ve started to think your single line “status” cells are not doing the trick, you are approaching the danger zone.
• If your users are adding a paragraph or two of explanation to a cell and making the spreadsheet unwieldy, you may be in trouble.
• If you are spending hours trying to format workbooks to print nicely, you are starting to feel the pain. 

Trying to create additional workbooks to hold longer explanations or to hold project milestones and status updates won’t solve the problem – it will make it worse. Maybe a very smart Excel administrator could overcome some of these problems. But, as you will see in my future posts, Excel's inability to drive action is only the tip of the iceberg.

“Back to the Future” of Quality with Deming & Baldrige

I recently read a report from the Conference Board Quality Council, A Leadership Prescription for the Future of Quality, that provoked a rant. So here it is.

It bugs me when TQM, Six Sigma, Lean, re-engineering, and Baldrige are treated as competing models rather than pieces of the same puzzle. The frame of the puzzle is the Baldrige Criteria, but all the other models fit nicely inside. It particularly irks me how, in the last few years, quality publications seem to be all about process improvement, leaving management off the hook for creating a strategic context and priorities for process improvement. I always took at this trend as “do as I say, not as I do.” Management can keep on being political and reactive, while telling the folks down in the trenches to change.

Well, that approach just doesn’t cut it. In the report from the Conference Board, the authors tell quality professionals they must “view themselves as more of a macro-leader, directly connecting their quality practices to business trends and top-line growth.” Better yet, the management team should lead quality; they can start by dusting off Deming’s Fourteen Points and the Baldrige Criteria.

Let’s get specific. The following are the “quality pitfalls" the authors identify, as well as my take on how they are avoided if quality is a management system within an organization (i.e. if an organization follows Deming's advice and applies Baldrige criteria).

Emphasizing process over results – It is no accident that the Baldrige Criteria assign 360 points out of 1,000 to one of the seven categories: Results. No matter how elegant your processes are, if they don’t produce strategic results, you have nothing.

Mis-aligning limited resources by working on lower-value items – A company could lose a lot of money doing less important things well. The Baldrige Criteria specifically ask “how do Senior Leaders create a focus on action to accomplish the organization's objectives?” The most common impediment to success is lack of focus. When management commits to too much, nothing gets done. In Deming’s words, management must create “constancy of purpose.”

Diluting key measures that drive action aligned to bottom-line results – Baldrige Category 4 can solve this problem. I could quote several requirements, but for starters, how about 4.1 a(3): “how do you keep your performance measurement system current with business needs and directions?” A corollary to my assertion that the most common cause of failure is taking on too much is that the most common flaw in performance measurement is measuring too much. When everyone is frantically collecting data, there is no time to use it. Measurement systems with a lot of stuff no one cares about soon perish, along with the important measures that are obscured by volume.

Implementing measures that drive conflicting or bad behavior – Let’s lateral the ball to Dr. Deming on this one. His tenth point of fourteen says: “eliminate slogans, exhortations, and targets for the work force asking for zero defects and new levels of productivity. Such exhortations only create adversarial relationships.” Not much commentary needed here, but I will add that the Baldrige Criteria require systematic review of measurements and their effects.

Delegating quality leadership to departments, leading to lack of responsibility – Deming’s Fourteen Points are not addressed to the people who are low on the “depth chart.” All fourteen are the responsibility of top management. Many, if not everyone in the organization, should be involved, but there is no delegation in the Fourteen Points. “Management must awaken to the challenge, must learn their responsibilities, and take on leadership for change.”

Acting as if quality is a destination rather than a sustaining, cultural norm – Point five of fourteen does the job here: “improve constantly and forever the system of production and service, to improve quality and productivity, and thus constantly decrease costs.” Lest we neglect the Baldrige Criteria, there is an entire item dedicated to workforce engagement with Deming’s “new philosophy.”

Dismissing past knowledge versus evolving lessons learned into continuous improvement – Quoting Joan Rivers, “don’t get me started.” It used to be only Americans who wanted to know “what is the latest” rather than “what is the best.” Now the world has caught our affliction. The whole “flavor of the month” thing is a symptom of wanting to move on, rather than build on. TQM is almost a dirty acronym now, rather than an important movement that came and went not because of flawed concepts but because the concepts were not adopted at all levels.

Deploying quality without context and expectations – To this point, I say "I rest my case." It’s "back to the future" for organizations to thrive. Process quality outside of organizational quality can save some bucks in a thriving economy in which stockholders simply don’t care about horizons over one year. But to dig out of an economic hole or sustain success for stakeholders, a systems approach must be extended to the big picture and the model for doing that is right on the shelf; dust it off and “just do it.”

Want to see a real-world example of how the Baldrige model addresses these "quality pitfalls"? Read a Case Study about the City of Coral Springs, a 2007 Baldrige recipient (and my previous employer).

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